Ending medallion oligopoly will help clean up the mess

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So the mayor of Boston, channeling his inner Captain Renault, is shocked — shocked! — to find that Boston’s taxi industry is a rigged and pitiless racket.

Why, until he read about it in The Boston Globe, Tom Menino never had a clue that in the city he has presided over for 20 years, cabbies are commonly treated like serfs, abused by multimillionaire owners who flout the law with impunity. If it hadn’t been for the Spotlight team’s detailed exposé, the mayor still wouldn’t know about all those besieged Boston cab drivers, most of them immigrants, who have to work exhaustingly long shifts as “independent contractors” without benefits or job protection — and with no assurance of earning a living wage. He still wouldn’t know about the bribes and swindles many cabbies are forced to endure if they wish to stay employed. Or about the grossly underinsured cabs that put passengers and pedestrians at grave financial risk. Or about the Boston police regulators who do nothing — and claim to know nothing — about the corruption endemic in a system that empowers fleet moguls to gouge drivers.

To hear Menino tell it, these revelations all came as news to him. “I’m very concerned about it,” the mayor said in an interview with the Globe last week. “We’re not going to tolerate this nonsense.” Except that he does tolerate it. The Menino administration “turns a blind eye to this climate of casual exploitation,” the Globe reported. “Worse, city officials — in ways both subtle and obvious — enable it.”

Stung by the negative publicity, not to mention the fact that federal prosecutors have launched a criminal investigation, Menino is promising a wall-to-wall review of the city’s taxi industry. He vows to “revamp” the hackney division of the Boston Police Department — maybe even get the BPD out of the business of regulating the taxi industry altogether.

Far be it from me to doubt the mayor’s newfound zeal. But like Captain Renault’s aversion to gambling in “Casablanca,” Menino’s distress over the exploitation and ill use of cabbies was never something he was known for in the past.

When taxi drivers were being attacked by armed passengers in the 1990s and early 2000s, for example, the mayor seemed to take it all in stride. Only when some drivers threatened to stop picking up fares in Roxbury and Dorchester, where the worst attacks had occurred, did Menino get worked up. “We will not tolerate any discrimination,” the mayor warned. The head of his hackney division — Mark Cohen, then as now — accused the cabbies of seeking to “systematically redline neighborhoods.” Most of the drivers were black, and the implication of racism was ludicrous. At a time when the Labor Department was reporting that cabbies were far more likely than other workers to be murdered on the job, it was also remarkably callous.

Boston’s streets are safer today, but taxi drivers are as economically vulnerable as ever, squeezed by a system that has been stacked against them for decades.

The cruelties and rip-offs documented by the Globe’s series are ugly indeed, but uglier by far is the government-sanctioned oligopoly that sustains it. Boston’s antiquated medallion scheme, which arbitrarily caps the number of taxis in the city at 1,825, is the real reason the taxi industry is so abusive. Because the supply of medallions is so much lower than the demand, their value has soared, massively enriching those who were lucky enough to acquire the little tin plates when they were cheap — and fleecing nearly everyone else. Would-be cabbies must choose between going deeply into debt to acquire a medallion — the price in Boston now is up to $625,000 — or paying through the nose to lease one for 12 hours at a time.

No one imagines that City Hall should decide the number of bookstores or florists Boston needs; an official ceiling on the number of cabs is no less irrational. What Menino calls “this nonsense” — the grinding, humiliating, overpriced unfairness that is the daily lot of so many cab drivers — didn’t just happen. It was caused by the deprivation of economic freedom. It can be cured by the restoration of that freedom.

Can you visualize more cabs in Boston’s neighborhoods, more owner-entrepreneurs driving them, better service, and lower fares? Then you can visualize an end to the medallion oligopoly. After 80 years of the current mess, isn’t it time for something better?

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